No historic correlation between BTC demand and price. Transaction volume is surely at an all time high, and the price
well
The thing about currencies is that they 'circulate'
I don't think bitcoin is ever going to be a 'currency' other than by denomination (i.e. payment channel sense).
I think it's squarely a store of value and will therefore have a similar role to gold - i.e. sit in vaults (the blockchain in this case) and do more or less nothing while the various numbers in accounting ledgers that it backs get shunted around the economy add infinitum.
It's perfect for that role - even more so than gold - and is already well down that road with the popularity of cold wallets.
Sure, it will get traded but I think there will be a far greater amount of trade thats denominated in bitcoin than actually ever gets moved around the blockchain. Every other money has always gone that way. Look at the names of most of the paper currencies - they all correspond to WEIGHTS. Weights of metal:
- pounds sterling (pounds of silver)
- peseta
- peso (large silver coin of specific weight)
- dollar (another name for a peso = weight)
- dinar (a gold coin)
The actual metals quickly went out of circulation and took up their role as a store of value residing in vaults, while "peso/dollar" denominated paper took its place as the actual currency. So people were still trading weights of metal in principle, they just weren't carrying it around with them all the time and carried paper proxies issued by the banks instead who (supposedly) kept the metal stashed in their vaults should anyone care to come and redeem their tickets for the real thing.
Thats how bitcoin will go - the economy will grown as bitcoin denominated trades grow, but the transaction volume will far outweigh the actual movement on the blockchain by many orders of magnitude.
Thats my theory anyway
For now.
